Florida Gov. Rick Scott is facing heavy lobbying from both sides of the fast-track foreclosure bill that arrived on his desk this week.

Response in support of the plan, HB 87, narrowly outpaces those fighting the bill, which passed both chambers during the 2013 legislative session after years of debate and compromise.

Calls in favor of the legislation stood at 632 on Thursday, with opposition calls at 563.

Scott has until June 12 to take action on the bill, or he can allow it to become law without his signature. He’s been asked by homeowner advocates and Sen. Darren Soto, D-Orlando to veto the legislation on grounds that it violates historic property rights laws and puts more onus on the homeowner to prove why he or she shouldn’t lose their house.

“In the middle of the game this law would change the rules of current engagement of existing trials before judges,” said Oppenheim Law, South Florida real estate [foreclosure] defense attorney Roy Oppenheim, who opposes the bill. “This will only create more uncertainty and a host of new issues will ultimately arise.”

Proponents of the bill say it will streamline Florida’s meandering foreclosure process, making it easier to foreclose on abandoned and vacant homes while helping homeowners by reducing the amount of time a bank can pursue a borrower for unpaid debt from five years to one year.Continue reading→

Now, the IRS discovered that banks acting as servicers for “REMICs”, otherwise known as Real Estate Mortgage Investment Conduits, have been claiming tax-exempt status on the income they generate under favorable tax code provisions.

So what is a REMIC? A REMIC is a passive entity where mortgages are pooled and securitized into investments. Generally, the investors in REMICs are large funds, pension plans, and 401ks.

Not only did the banks failed to comply in any manner with the requirements of the Internal Revenue Code that allow this favorable tax treatment, they have apparently decided to ignore the IRC altogether.

So what does this mean for taxpayers?

It means that the banks have been systematically ignoring IRC provisions, thinking the IRS is too sheepish to enforce the law. These entities, as a result of the actions of the banks servicing the mortgages, have failed to pay billions of dollars in taxes, and robbed the government, and thus the American people, of that money.

The reason that REMICs were afforded this massive tax break is due to the fact that they are meant to be vehicles for passive investing, and as such they have rules for strict compliance that require that all mortgages passing into a REMIC must be transferred into a trust within 90 days of trust formation.Continue reading→